No. of Recommendations: 30
Just read a comment from a Seeking Alpha reader, hijlehhw (on 3-28), and thought it was outstanding:
'I find it a bit comical that so many people admire Warren and Charlie and what they have built, read the letters to shareholders and then question the succession plan and are worried.
They seem to forget that these same guys, who have published their viewpoints for decades ALSO are quoted saying "If you've got a good enough business, if you have a monopoly newspaper, if you have a network television station ' I'm talking of the past ' you know, your idiot nephew could run it. And if you've got a really good business, it doesn't make any difference.", to paraphrase, "find a business that is so good that even an idiot could run it, because sooner or later, one will".
Some are worried that Greg might be an idiot. Clearly he is not. BRK had the pick of probably ANYBODY they wanted, and Warren picked Greg, his track record in energy speaks for itself, his personal reputation speaks for itself, his BRK ownership/percentage of NW speaks for itself. This is not even considering the quality of businesses that make up BRK, they are of such quality that arguably "even an idiot would do well" and Greg is certainly better than that!
You cant/shouldnt pick and chose what you believe. Warren and Charlie are either brilliant, thoughtful, strategic and principled or they are not. They either make good decisions and think things out and have planned succession that will protect the culture and moat of BRK or they have not. BRK is of such quality that it will endure or it will not. But to say look at this masterpiece that Warren and Charlie have spent their entire life creating, and is of such significant value to them that they will have a very solid and well thought out plan for it when they are gone may not be the case is ridiculous IMO. Everyone thinks the masterpiece is done when they are gone without considering that the succession plan IS part of the masterpiece, that succession will be Warrens CRESCENDO!!
I hope that Warren and Charlie are able to at least double their current tenure at BRK, but reality will be otherwise. As a BRK shareholder with the majority of my own NW in the name, what makes me most excited for the future is BHE with the ability to deploy tremendous amounts of capital with guaranteed satisfactory returns. And Warren appointed one of (if not the best in the world) in the energy space to be CEO. An appointee that shares his vision, is also logical, reasonable, principled and has a significant portion of his own personal wealth in BRK to align his interests with shareholders. Although many BRK dread the day the "news" breaks and will feel a significant loss that day and for years to come, the loss wont be due to the culture, quality or moat of BRK as a whole.
True shareholders, the kind WB/CM value and want and work to protect know that the crescendo is coming, but dont question how the maestro designed it, they trust that it will be equal or greater than the entire symphony they have enjoyed for so many years.'
No. of Recommendations: 8
While I think that there is a lot of value in considering that their record of building and operating the business deserves to garner a great deal of trust, one of the more common ways very smart people get into trouble is by believing that expertise in one field translates into another. They have certainly hired a number of excellent people over the years, and have had a few who did not work out (e.g. Sokol).
I'm certainly willing to entertain a high level or trust in the decision makers at Berk, but hiring someone with a long track record of excellence is different than projecting future success on someone who has not already done so. Predictions about the future are even harder without evidence from the past. I think that being uncomfortable about the appearance of nepotism where there has not been public demonstration of exceptional competence is a valid reason to be concerned. There is certainly some scope to extend trust in their decisions, but that doesn't mean that we should give over any concerns at all - but perhaps keep and eye on it and see how it looks as it plays out, and be ready to speak up if problems arise.
